Theresa Villiers: It gives me great pleasure to sum up the debate this evening. The Secretary of State for Trade and Industry and my hon. Friend the Member for Hertford and Stortford (Mr. Prisk) began the debate robustly, as one would expect. My hon. Friend spoke about competitiveness and the Budget's impact on small businesses. He raised a range of themes, to which I shall revert throughout my speech.
	The hon. Member for Coventry, North-West (Mr. Robinson) began by defending the Chancellor's sanity and proceeded, slightly oddly, to express some significant reservations about two of the centrepieces of the Budget. Even the Chancellor's friends appear to have reservations about what he produced in the Budget.
	The hon. Member for Twickenham (Dr. Cable) spoke about a range of important issues, including the key fact that the value of take-home pay is now falling in this country. People's weekly wage packet buys them less and less and the retail prices index is at its highest for 16 years.
	The hon. Member for Blaydon (Mr. Anderson) recognised that the Opposition's concerns about the loss of the 10p band had merit. He spoke with passion and commitment about education and the schools in his constituency.
	My right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) produced an analysis of huge insight. The time available makes it impossible to do it justice. He spoke of the benign global economic conditions that the Chancellor has enjoyed and commented on the Chancellor's making a dreadful mess of public finances. He welcomed the Chancellor's recognition that we were right and said that we should share the proceeds of growth.
	The hon. Member for Coventry, South (Mr. Cunningham) spoke about his support for restoring the link between pensions and earnings. My hon. Friend the Member for Gainsborough (Mr. Leigh) talked about the importance of efficiency savings in Government and made a strong plea for progress towards lower taxes.
	The hon. Member for City of Durham(Dr. Blackman-Woods) expressed her concerns about the Government's misconceived planning gain supplement. My hon. Friend the Member for Northampton, South (Mr. Binley) spoke with verve, energy and passion about small business.
	My hon. Friend the Member for Beverley and Holderness (Mr. Stuart) delivered a devastating critique of the Treasury's record on the environment. My hon. Friend the Member for Ludlow (Mr. Dunne) spoke at some length about a range of issues, including sideways loss relief and the Budget's impact on enterprise. My hon. Friend the Member for Christchurch (Mr. Chope) expressed his grave concerns about the tax rises that the Government have introduced.
	This was not a tax-cutting Budget. The Institute for Fiscal Studies has calculated that 3.5 million families will be worse off because of it. Page 279 of the Red Book reveals that tax will be up by £2 billion once all the Budget measures kick in, on top of the £2.4 billion in tax increases already trailed this year in the public sector borrowing requirement and other measures. The Chancellor has raised taxes 99 times since his first Budget 10 years ago and the IFS tells us that the average family is paying £5,600 more tax a year in real terms. The Chancellor is about as credible on tax cuts as the Prime Minister on weapons of mass destruction.
	This Budget was a tax con, not a tax cut. It did not cut taxes on income. Page 208 of the Red Book shows that the £8 billion cost of cutting the basic rate will be more than offset by a £7 billion increase from scrapping the 10p band and a £1 billion increase from raising the national insurance limits. The overall impact of the income and national insurance contributions changes means that working families will be paying £340 million more tax on their income next year.
	It is not the rich who are being hit—not the guys in the City who are paid £22 million. People earning between £5,000 and £18,000 will pay more income tax. Nurses, cleaners, care workers, police community support officers, shop assistants, catering workers: those are the sort of people who are losing out. The Budget involves a transfer of the burden of tax from those on middle incomes to those on low incomes. This is the Budget that Labour Back Benchers cheered, by the Chancellor who claims he wants to tackle poverty.
	The Chancellor seems to think that hitting the poorest with a higher income tax bill is not a problem, because tax credits soften the blow. What he is saying, in effect, is, "I'll take away more of your money, but you can have some of it back if you wade through these 72 pages of forms and explanatory notes on tax credits." The Budget will drive more people into the benefits system and into dependency.
	Let us look at the tax credit system that people are being driven into. We support the use of tax credits—[Hon. Members: "Ah."]—but the tax credit system is broken, with £2 billion lost through fraud, nearly a million people underpaid and 2 million overpaid, meaning that half the payments in the system are wrong. Thousands of the most vulnerable people in our society are in desperate straits, driven into the hands of loan sharks when faced with huge overpayment bills that they cannot afford.
	The Budget's increase in the tax credit withdrawal rate will leave many low-income families facing marginal tax rates of 70 per cent. or more as they struggle to lift themselves out of poverty. There are more people in deep poverty now than there were when the Chancellor gave his first Budget 10 years ago. Figures released today show the incomes of the poorest 20 per cent. falling and poverty increasing. How right the right hon. Member for Darlington (Mr. Milburn) was when he said that poverty has become "more entrenched" under Labour.
	This Budget was not about tax reform. No Budget can claim to be simplifying when it increases dependency on highly complex tax credits. There are, it is true, some modest steps in the Budget towards tax simplification. We have put the issue at the top of our agenda and it is good news that the Chancellor has been pulled along in the wake of my hon. Friend the Member for Tatton (Mr. Osborne), but these limited reforms cannot make up for the continual meddling and instability that has characterised our tax system since the Chancellor's first Budget.
	We have slipped to 67th in the world league table on simplicity, so 66 countries now have a simpler and more rational tax system than we do—including Cambodia. The length of the direct tax code has doubled—1,000 years of tax law doubled in a little under 10 years. This year's Finance Bill might even see us overtake India and give us the longest tax code in the world.
	This was not a budget for business. It is true that we welcome some of the changes made to the taxation of large businesses. We have been examining the case for a reduction in the headline rate of corporation tax, funded by scrapping some of the complex reliefs that have multiplied under the Chancellor. Last week, we called on him to do that and he has responded, but, frankly, the impact will be limited when set against£50 billion in extra business taxes levied since 1997. Overall, taxes on business will be up by £1 billion next year.
	The Chancellor may have taken some of our advice on large companies, but he has headed in the opposite direction on smaller companies. He has raised rates and made the system more complicated, so we will be voting against his proposals on small business. After11 Budgets, six rate changes and a cycle of continuing revolution worthy of Chairman Mao, never mind Stalin, he is almost back where he started on small company taxation, except that small businesses will be paying more tax in a more complex and unstable system.
	Small businesses employ 58 per cent. of private sector workers, which is more than 12 million people. Those businesses are not only a crucial source of enterprise and innovation and the big companies of the future, but the bedrock of our local communities. The people who will lose out in a big way because of this Budget are hairdressers, newsagents, caterers and small retailers, who are already struggling with falling living standards and rising inflation.
	Some 10,000 small local shops have closed since 2000. How many struggling suburban high streets will face further decline as a result of this tax hit? How many more village shops and local post offices will face closure? The Chancellor claims that new allowances mean that businesses that invest will not lose out, but how can a small suburban post office shell out thousands of pounds on investment to make up for the Chancellor's tax grab?
	The Chancellor has delivered a double whammy with a new tax hit on contractors through managed service companies. David Frost of the British Chambers of Commerce has said:
	"This is a substantial rise and will hit those looking to grow their business."
	Paula Tallon of Chiltern tax advisers has summed it up:
	"Small companies are getting thumped again."
	This was not a Budget for enterprise and competitiveness. With the thumping that business has received from the Chancellor in higher taxes, a more complicated tax system and a massive increase in regulation, it is no wonder that business investment has slipped below 10 per cent. of GDP for the first time since records began, that productivity growth has stagnated in Britain, that we have dropped from fourth to 10th in the world league table on competitiveness, that the UK grew more slowly last year than 21 other members of the EU, and that unemployment rose more quickly in Britain last year than anywhere else in the developed world.
	This was not a Budget for saving and pensions, either. The Red Book contains the melancholy news that the savings ratio has virtually halved since the Chancellor's first Budget, in which he dealt a body blow to savings in Britain with his £100 billion raid on pension funds. That was followed by recurring and damaging instability in pensions tax, culminating in the predictable mess that he made this year of pensions term assurance.
	The Chancellor announced new money for those who have lost their pensions, which we welcome, but he failed to point out that that would be spread over60 years. The net present value of the new money was barely a third of the figure that he announced with a flourish on Budget day. Ros Altmann's verdict was:
	"Today's announcement does nothing for most of those who are struggling without their pensions today...This is typical Gordon Brown—trying to get good headlines when the reality is not good. People are still suffering."
	This was not a Budget for education. The promised bonanza for education spending has turned out to be a modest increase of just less than 2.5 per cent. Over-hyped announcements on spending cannot disguise the scandal that one in six young people leave school unable to read, write or add up properly and that 100,000 14-year-olds have the reading age of a seven-year-old.